Welcome to your Monday Biotech Deal Review for August 19, 2013! As August comes to a close, activity is beginning to pick up. Bellus and Valeant have closed their acquisitions of Thallion and Bausch + Lomb, respectively. On the financing side of things, Sophiris and Covalon are pursuing offerings, with Sophiris looking at rasing $65 million. Finally, Transition, Vivione and Quest PharmaTech have executed deals for licensing or development.
Hit the break to see the whole story on these major deals and for the rest of the past weeks’ stories!
BELLUS Health Inc. (TSX: BLU) and Thallion Pharmaceuticals Inc. (TSX:TLN) have closed the previously announced arrangement pursuant to which BELLUS Health has acquired all of the issued and outstanding common shares of Thallion Pharmaceuticals Inc. (“Thallion”) (TSX-V: TLN) for a purchase price of $6.266 million or $0.1889 per common share, and the issuance of one contingent value right per common share.
Valeant Pharmaceuticals International, Inc. (NYSE: VRX, TSX: VRX) has completed the previously announced acquisition of Bausch + Lomb Holdings Incorporated. Bausch + Lomb is a leading global eye health company that has a broad portfolio of eye health products, including well-known prescription and
Covalon Technologies Ltd. (TSXV: COV) intends to complete a non-brokered private placement comprised of 750 units (the “Units”) at a price of $1,000 per Unit for gross proceeds of $750,000. Each Unit will consist of $1,000 principal amount of 12% senior secured convertible debenture (the “Debentures” and each a “Debenture”) and 6,452 warrants (each, a “Warrant”). Proceeds of the private placement will be used by Covalon to fund the market launch of the Company’s new products IV Clear™ and SurgiClear™ and for general working capital. Each Debenture will be convertible at the holder’s option into 6,452 common shares of the Company (the “Common Shares”) at a conversion price of $0.155 at any time on or prior to the Maturity Date, which will be three years from the closing date. These conversion rights will be subject to standard anti-dilution provisions. The Debentures will bear interest at the rate of 12% per annum and will be direct secured obligations of the Company ranking senior to all indebtedness of the Company.
Resverlogix Corp. (TSX:RVX) has announced that it has closed its previously announced private placement of 1,765,307 units at a price of CAD$0.90per Unit for gross proceeds of CAD$1,588,776 (the “Private Placement”) to Eastern Capital Limited (“Eastern”). Each Unit was comprised of one common share of Resverlogix and 0.3 of a common share purchase warrant. Each full warrant is exercisable at a price of CAD$0.90 for a period of five years. The shares are subject to a four month hold period. After giving effect to the Private Placement, Eastern holds 14,965,307 common shares of Resverlogix, representing approximately 19.4% of Resverlogix’s issued and outstanding common shares. Eastern also holds 2,578,232 common share purchase warrants of Resverlogix.
Aeterna Zentaris Inc. (TSX: AEZ) (NASDAQ: AEZS) announced announced that it has completed its registered direct offering of $7.8 million of units comprised of common shares and common share purchase warrants to certain institutional investors. Net proceeds from this offering, after deducting placement agent fees and other offering expenses, total approximately $7 million. All of the securities were offered pursuant to an effective shelf registration statement. Proceeds from the transaction will be used to continue to fund the Company’s ongoing drug development activities, primarily for the advancement of its zoptarelin doxorubicin (AEZS-108) program, secondly for its macimorelin acetate (AEZS-130) program, as well as for general corporate purposes and working capital.
Sophiris Bio Inc. (Sophiris, TSX: SHS) has entered into an underwriting agreement with Citigroup and Leerink Swann, as joint book-running managers, with respect to an offering of 13,000,000 common shares of the Company (the “Shares”) at a price of US$5 per Share (the “Purchase Price”) for aggregate gross proceeds of approximately US$65 million. Stifel and Lazard Capital Markets are acting as co-managers. The Company has also granted to the underwriters a 30-day over-allotment option (the “Option”) to purchase up to an additional 1,950,000 Shares at the Purchase Price, for additional aggregate gross proceeds of up to approximately US$9.75 million. The Company will file a final short form prospectus with the securities regulatory authorities in British Columbia and Ontario in connection with the Offering.
Transition Therapeutics Inc. (TSX: TTH) has closed its previously announced private placement through which 2,625,300 units of the Company were purchased by Jack W. Schuler, Larry N. Feinberg, Oracle Investment Management, certain Transition Board members, management and other existing shareholders. Gross proceeds of the private placement totalled US$11 million.As previously announced, each unit consists of (i) one common share, (ii) 0.325 Common Share purchase warrant with a purchase price of US$4.60 per whole warrant and (iii) 0.4 Common Share purchase warrant with a purchase price of US$6.50 per whole warrant. Each whole warrant will entitle the holder, within two years, to purchase one additional common share in the capital of the Company. If and when all of the warrants are exercised, the Company will realize an additional US$10.7 million in proceeds. They also announced the exclusive licensing of worldwide rights to a novel small molecule transcriptional regulator (“TT-601”) from Eli Lilly and Company for the treatment of osteoarthritis (“OA”) pain. TT-601 is a potent and selective ligand for a novel nuclear receptor target. Modulating the activity of this novel target in patients with osteoarthritis may provide pain relief to a large segment of OA patients who do not have adequate response to therapy with NSAIDs (non-steroidal anti-inflammatory drugs). TT-601 has completed preclinical development to date and Transition anticipates can enter the clinic in the first half of 2014.
Highland Therapeutics Inc., has announced that it has completed a US$6.7 million offering of Class A common shares. Investors in the offering included Highland’s Clinical Development group – an arm’s length entity responsible for the manufacturing and clinical development of the Company’s two lead compounds. Highland believes their substantial investment further aligns their interests with those of all shareholders and welcomes them as new shareowners.
Commercial & Other Agreements
Vivione Biosciences Inc. (“Vivione”) (TSXV: VBI) announced a new development relationship with Kirkegaard & Perry Laboratories, Inc. (“KPL”). This relationship is expected to allow Vivione to accelerate commercialization of the detection kits used in Vivione’s RAPID-B food-borne pathogen detection platform. The detection kits will be powered by KPL’s well-characterized BacTrace® affinity-purified primary antibodies. Vivione and KPL plan immediate initiation of manufacturing and commercialization of the detection kits, with the first commercial detection kit (E. coli O157:H7) already submitted for independent certification by the Association of Analytical Communities.
Quest PharmaTech (TSXV: QPT) has entered into a long term strategic relationship with AD Biotech Co., Ltd., a Korean based biotechnology company, to share research and technology development resources with the intent to co-develop technologies of both companies. AD Biotech has provided $2,000,000 of clinical development funding to Quest and has agreed to provide up to $10,000,000 of additional funding in return for Quest common shares and future revenue sharing. The agreement with AD Biotech complements the arrangement that Quest has with Mr. Gi-Ho Park and his affiliated Korean company, for which Quest received shareholder and regulatory approval during Quest’s Annual General and Special meeting of shareholders held July 26, 2012.